NCUA audit: MDI program effective, but lacks recertification review
The NCUA does a good job of nurturing Minority Depository Institutions (MDIs) but fails to ensure that those institutions continue to meet MDI requirements, the agency’s Inspector General said, in a report released Monday.
“Specifically, we determined the NCUA took actions to preserve the present number of minority depository institutions, preserve the minority character of MDIs, provide technical assistance to prevent insolvency of MDIs, promote and encourage the creation of MDIs, and provide training, technical assistance, and educational programs,” the IG stated in an audit of the MDI preservation program.
But the IG also warns that “the NCUA did not conduct a required review to determine if MDIs continued to meet the MDI definition because the agency did not design and implement a process to validate the self-certification.”
As a result, some MDI credit unions continue to receive the benefits of being an MDI even though they no longer meet the requirements.
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